When Does Information Affect Power? Evidence from Strong and Semi-Strong Exchange Networks

Does the completeness of actors’ knowledge affect the exercise of power in social structures? Exchange theories and the experiments used to test them vary in the level of information availability—ranging from fully transparent to sharply restricted. These paradigms implicitly assume that actors’ knowledge corresponds directly to the information provided. While previous experiments have compared exchange payoffs under complete and restricted information, no theory explains why differences in power outcomes should or should not emerge across exchange structures under differing informational conditions. This paper investigates how knowledge shapes the exercise of power in exchange networks, where power is operationalized as payoff differences between actors. Knowledge is defined as what an actor can infer from experimental information and within-structure interactions, rather than as information alone. The study first examines whether restricting information effectively limits actors’ knowledge and finds that it does. It then uses new and previously published experimental data to analyze how information conditions (complete versus restricted) and structure type (strong versus semi-strong) jointly affect actors’ ability to secure advantageous payoffs in exchange relations. The results resolve previously contradictory findings on the relationship between information availability and power exercise in exchange networks by demonstrating that the effects of knowledge depend on both network structure and the form of rationality actors can plausibly employ under given informational constraints.